Agenda No. 2.
CITY COUNCIL MEMORANDUM
| City Council Meeting: | April 21, 2026 |
| Department: | Executive Team |
| Subject: | Resolution 26-R-057 - Approval of the Heritage Oaks Wastewater Capital Recovery Offset Agreement (S.Williams/B.James) |
BACKGROUND
On June 17, 2025, City Council approved a wastewater capital recovery offset agreement with the developer of the Heritage Oaks subdivision that is located on the west side of Schertz Parkway, on the north and south sides of Wiederstein Road. The agreement has never been executed, and the developer is seeking approval of a revised agreement.
The developer of the Heritage Oaks residential subdivision is constructing approximately 1,800' of 8" waterline generally in Wiederstein Road from Schertz Parkway to Dietz Creek. This line is on the City's Wastewater Impact Fee Capital Improvements Plan. Given that it is on the City's Wastwater Impact Fee Capital Improvements Plan, the developer is entitled per State Law and Section 90-152 of the City's Code of Ordinances, to offsets/credits for this construction. Per Section 90-152, "The unit costs used to calculate the offsets shall not exceed those assumed for the capital improvements included in the capital improvements program for the category of facility within the service area for which the capital recovery fee is imposed." Related to this, the developer has proposed to realign Wiederstein Road as part of his proposed development and this per the UDC is having to construct Wiederstein Road. He is receiving Roadway Impact Fee Credits for doing so (Roadway Capital Recovery Offset Agreement approved per Resolution 25-R-055). As such, the cost in the wastewater Impact Fee CIP, which did not assume the road was having to be realigned and reconstructed, includes a cost for the full surface replacement. This full cost would not apply in this case, but some cost would. His maximum impact fee credit is estimated to be no more than $990,000.00.
Subsequent to approval of the first agreement, the developer has presented documentation to support that he does have some costs associated with surface replacement not covered by his roadway impact fee credit. Additionally, since the developer prepaid a significant amount in impact fee a few decades ago, it is anticipated he is not going to need his full impact fee credit of $990,000. It is estimated he will be reimbursed approximately $355,000. The developer is also requesting he be paid this credit upon acceptance of the sewer line, rather than upon completion of the development.
The developer of the Heritage Oaks residential subdivision is constructing approximately 1,800' of 8" waterline generally in Wiederstein Road from Schertz Parkway to Dietz Creek. This line is on the City's Wastewater Impact Fee Capital Improvements Plan. Given that it is on the City's Wastwater Impact Fee Capital Improvements Plan, the developer is entitled per State Law and Section 90-152 of the City's Code of Ordinances, to offsets/credits for this construction. Per Section 90-152, "The unit costs used to calculate the offsets shall not exceed those assumed for the capital improvements included in the capital improvements program for the category of facility within the service area for which the capital recovery fee is imposed." Related to this, the developer has proposed to realign Wiederstein Road as part of his proposed development and this per the UDC is having to construct Wiederstein Road. He is receiving Roadway Impact Fee Credits for doing so (Roadway Capital Recovery Offset Agreement approved per Resolution 25-R-055). As such, the cost in the wastewater Impact Fee CIP, which did not assume the road was having to be realigned and reconstructed, includes a cost for the full surface replacement. This full cost would not apply in this case, but some cost would. His maximum impact fee credit is estimated to be no more than $990,000.00.
Subsequent to approval of the first agreement, the developer has presented documentation to support that he does have some costs associated with surface replacement not covered by his roadway impact fee credit. Additionally, since the developer prepaid a significant amount in impact fee a few decades ago, it is anticipated he is not going to need his full impact fee credit of $990,000. It is estimated he will be reimbursed approximately $355,000. The developer is also requesting he be paid this credit upon acceptance of the sewer line, rather than upon completion of the development.
GOAL
Provide for the orderly development of infrastructure within the City of Schertz.
COMMUNITY BENEFIT
Provide for the development of infrastructure in a timely, cost-effective manner.
SUMMARY OF RECOMMENDED ACTION
Approval of Resolution 26-R-057 authorizing a Wastewater Capital Recovery Offset Agreement with the developer of the Heritage Oaks Subdivision for the construction of approximately 1,800' of 8" wastewater line in Wiedertein Road, generally adjacent to the development.
FISCAL IMPACT
The fiscal impact to the City is estimated to be $355,516.00 paid to the applicant as acceptance on the infrastructure. The value of the improvements provided by the applicant is $990,000.00 with the estimated $630,000.00 paid for by the applicant in lieu of impact fees and $355,516.00 paid for by the City Sewer Impact Fee Fund.
RECOMMENDATION
Approval of Resolution 26-R-057.